The biggest issue in fundraising today Background – a bit about me. I was Praxis Fundraising. Now RLF. 20+ years working in fundraising specialising in copywriting and strategy. The biggest issue in fundraising today JILL RUCHEL - RED LETTER FUNDRAISING

Work from home – this is my office Work from home – this is my office. 24 chooks, 10 quail and 2 sheep called Pizza and Roast. RED LETTER FUNDRAISING

RETAINING YOUR DONORS RED LETTER FUNDRAISING

DONORS CARE CCNSW story RED LETTER FUNDRAISING

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9% 22% $100 plus donor response rates over 15 months 9% 22% $100 plus donor response rates over 15 months RED LETTER FUNDRAISING

Commercial retention Non-profit retention 41% retention 90% retention Non-profits 41% retention 90% retention Source: Craver, R Retention Fundraising 2014 RED LETTER FUNDRAISING

Why is it so important RED LETTER FUNDRAISING

Lifetime value Because it underpins ifetime value RED LETTER FUNDRAISING

What is donor retention? The number of donors you keep from one year to the next RED LETTER FUNDRAISING

Why is it donor retention important? A measure of your effectiveness as fundraisers A measure of donor satisfaction Underpins the lifetime value of the donor to your organisation Improving donor retention is the single most important thing you can do to improve your bottom line RED LETTER FUNDRAISING

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Calculating donor retention Step 1 – calculate the total number of donors who gave in your most recent fiscal or calendar year Step 2 – Divide the number of donors who made a donation in year 2 by the total in year 1 Step 3 – multiply the result from Step 2 by 100 to get your retention rate as a percentage RED LETTER FUNDRAISING

Example: Step 1. 5000 donors who gave in 2013 Step 2. 2000 gave in 2014: Step 3. Divide the number who give in 2014 by the number who gave in 2013 and multiply by 100 2000/5000 = 0.4 Retention rate is 0.4 x 100 = 40% RED LETTER FUNDRAISING

Calculating lifetime value Average amount of donor’s gift to organisation X number of repeat gifts per year by that donor X average number of years your donors remain on your file. RED LETTER FUNDRAISING

Why is lifetime value important? It tells you how much your donors are worth to you over time It tells you how much it is worth spending on getting more donors It tells you how much it is worth spending on retaining donors and improving your retention rates (and thus increasing lifetime value). RED LETTER FUNDRAISING

Lifetime value of $660-$45 = $615 Example: You acquired Donor A in 2008 at a cost of $45 She gives an average of $110 pa Already at the end of 2014 she has given you: Income: 6 years at $110 = $660 Less acquisition cost of $45 Lifetime value of $660-$45 = $615 RED LETTER FUNDRAISING

Potentially means that every single name on your database is worth $615 It kind of makes getting their name right seem pretty important doesn’t it? RED LETTER FUNDRAISING

How much is it worth spending on retaining that donor? A lot RED LETTER FUNDRAISING

How much is it worth spending on making sure she is a happy donor How much is it worth spending on making sure she is a happy donor?   A lot   If she stays for another 5 years - $660 (+ possible upgrades and bequests) RED LETTER FUNDRAISING

How do you improve donor retention? Care about the things they care about Really understand your donors Find out what experiences really matter to your donors Shared values Genuinely like and care about your donors Have conversations. Listen!   Not just tactics – about really understanding your donors RED LETTER FUNDRAISING

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Show you care Dear Mrs Nguyen Thank you again for the wonderful gift you and your son sent last Christmas to help buy more pressure pumps and IV units for our hospital in the home service. I saw the lovely note from your son Thao that asked for extra address labels. I sent him two sets - I hope he was happy with them… RED LETTER FUNDRAISING

The objective is to build a sense of engagement and connection … to create HIGH COMMITMENT DONORS … worth 131% more Source: Craver, R, Retention Fundraising, 2014 p RED LETTER FUNDRAISING

How do you measure commitment? Survey your donors “I am a committed (charity name) donor” “I feel a sense of loyalty to (charity name)” “(Charity name) is my favourite charitable organisation” Respond to each question on a scale of 1-10 Average the response across all three questions That’s your commitment score RED LETTER FUNDRAISING

Rating commitment High commitment donors – 8-10 Mid-commitment donors – 5-7 Low commitment donors <5 RED LETTER FUNDRAISING

So what’s all this got to do with data? It’s the foundation RED LETTER FUNDRAISING

Consider the cost of … Getting someone’s name wrong Forgetting to do something you’ve promised Not thanking them Not taking the trouble to find out and record their preferences … RED LETTER FUNDRAISING

What you can do Talk to your donors Listen to what they have to say Find out what they’re interested in, and what they may be concerned about Find ways to record and acknowledge their personal interests Phone them Record their information accurately RED LETTER FUNDRAISING

If you do what you’ve always done, you’ll get what you’ve always got RED LETTER FUNDRAISING

Jill Ruchel Red Letter Fundraisin Jill.ruchel@gmail.com 0438 916 094 RED LETTER FUNDRAISING